Asics Europe lifted its sales by 8 percent in constant currencies for the nine months through September of last year, in spite of its decision to pull out of a few significant accounts as part of its selective distribution policy. After a robust third quarter, Asics Europe now expects even better results for the full year. These figures and projections exclude Haglöfs, the Swedish outdoor brand bought by Asics nearly three years ago.
The Japanese brand enjoyed particularly buoyant sales of running products in Europe for the nine months, with increases of 40 percent in sales of running apparel and 10 percent for running shoes.
Tennis, an increasingly important category for Asics, also generated impressive double-digit sales growth for the period, in both footwear and apparel. Other technical categories that performed strongly for the brand were volleyball, handball and court sports, along with sports accessories.
The European growth was propelled by strong double-digit sales expansion in France and Germany. Spain, Poland and Russia all delivered robust growth. The Benelux countries, Scandinavia and European distributors also contributed to the expansion with single-digit sales growth. Furthermore, the turnover recorded by Asics in its own stores soared by 66 percent for the nine months.
The company estimates that these results enabled it to gain market share in Europe, particularly in the third quarter of last year. It quoted estimates from NPD Sports Tracking Europe indicating that the entire sports footwear market in the five largest European markets expanded by 5.7 percent in value for the period, compared with 13.8 percent for Asics. In particular, the running shoe market in the same countries was up by 11.2 percent, compared with 20.9 percent for Asics, and the running apparel market advanced by 9.5 percent, compared with 18.8 percent for the Japanese brand.
Asics Europe pointed to consumer enthusiasm for its “natural” running range, and its marketing investments across the region, with TV advertising as well as digital marketing.
Meanwhile, Asics reported that its global consolidated sales for the three quarters until the end of December improved by 2.3 percent to nearly ¥190.5 billion (€1.5b-$2.0b). Asics lifted its sales by 1.0 percent to ¥63.5 billion (€0.5b-$0.6b) for the period in Japan, where it enjoyed strong sales of running footwear but saw its baseball sales weaken as it consolidated this category under the Asics brand. The group's sales outside Japan inflated by 2.9 percent to nearly ¥127 billion (€1.0b-$1.4b), driven by running footwear sales in the Americas and Europe.
A regional chart with a slightly adjusted way of tallying sales shows that the Asics brand's sales in the Americas jumped by 9.5 percent to ¥51.3 billion (€407.0m-$548.8m), a rise of 11.2 percent in constant currencies.
In yen, European sales were down by 2.8 percent to ¥48.7 billion (€386.5m-$521.0m) for the nine months (which are not the same as the period for which Asics Europe provided its own details above), but the performance amounted to a sales increase of 8.0 percent in constant currencies.
The discrepancy in reporting periods and currency exchange rates also distort the picture for Haglöfs: Asics reports that its turnover in other businesses, represented by the Swedish outdoor brand, was down by 3.1 percent in yen to just over ¥6 billion (€47.6m-$64.2m) for the nine months until the end of December, but this is equivalent to an increase of 4.1 percent in constant currencies, and Haglöfs has pointed separately to double-digit sales growth for all of 2012.
Footwear made up about 10 percent of Haglöfs' sales last year, growing faster than other product categories owing to the support offered by Asics. Haglöfs is also reaping the benefits of wider investments, such as the expansion of its design team. It won four Ispo awards this year, including two Gold Winner gongs. They went to the Rando AS suit, which is described as the world's first full ski suit in three-layer Gore-Tex Active; and the Roca II Hood, a durable soft-shell jacket.
Asics' consolidated operating income of nearly ¥16.4 billion (€130.1m-$175.5m) was down by 2.6 percent compared with the same period the previous year, due to an increase in purchasing costs and staff expenses.
Operating results were almost exactly stable in Japan but increased markedly in the Americas, up by 26.2 percent to ¥4.6 billion (€36.5m-$49.2m). They were down in Europe by 12.8 percent to ¥6.6 billion (€52.4m-$70.6m), but the decline only reached 3.1 percent in constant currencies. Haglöfs showed an operating loss of ¥63 million (€0.5m-$0.7m) for the period, but that was an improvement compared with the loss of ¥117 million (€0.9m-$1.3m) suffered for the same months the previous year.
Asics still ended the nine-month period with net income of ¥12.5 billion (€99.3m-$133.8m), up by 42.9 percent, due to tax refunds and interest income on them. The company predicts that its net sales will reach about ¥262.5 billion (€2.1b-$2.8b) for the full fiscal year until the end of March, which would be a sales increase of about 5.9 percent compared with the previous year, while its operating income should inch up by 1.9 percent to ¥20 billion (€158.8m-$214.1m) and its net income should reach ¥14 billion (€111.2m-$149.8m), up by 11 percent.
Meanwhile, Haglöfs has appointed regional managers to run its international business as part of a wider management reshuffle that was implemented at the start of this month. It fits with changes already implemented at Asics and within the Swedish outdoor brand's five-year strategic plan starting from 2011, Haglöfs Going Global, which has led to investments in new markets and own stores. Haglöfs has also appointed other new managers including a new chief financial officer, Eva Strand, who was previously finance director at GlaxoSmithKline. She replaces Espen Mortensen, who has been in the job for less than two years (more on Haglöfs in The Outdoor Industry Compass).
